Chicago Startup Offers Healthy, Organic Foods in Vending Machines

As a traveling salesman, Luke Saunders knew first hand just how hard it can be to find fresh food on the go.

“I was the person who would pick up prepared food for the road because I knew that when I got there, there wouldn’t be good options,” he says. “If I ever got to a place and I had forgotten to plan ahead, the options were limited for healthy food.”

“Even up until the night before starting out, I wasn’t really sure if anyone would buy food like this out of a vending machine,” he says.

The idea was completely untested; and his experience in the food industry was so limited, he knew that finding outside investors would be next to impossible.

To top it off, he wanted to do things “the right way”: buy organic versions of foods on the Environmental Working Group’s “dirty dozen” list of products known to readily absorb pesticides; use all biodegradable and recyclable packaging; and avoid genetically modified corn and canola oil.

“I felt we could have a profitable business and do things the right way,” he says. “Our first goal is to feed people and make them healthy.”

Without any external funding, he drew from his own savings to launch his first two machines in the fall of 2013 in a downtown Chicago food court and at a Lake Forest rest stop..

Within three months, he landed a large contract with a local hospital group and was able to show a revenue model and qualify for a private loan. Today, there are 18 machines within a 15-mile radius that the company stocks daily.

Every morning, Farmer’s Fridge staff head to a shared industrial kitchen and prep salads, such as the Free-Radical Assassin, packed with mixed greens, goat cheese, and mixed berries; the Body Builder, layered with organic spinach, chickpeas, and local corn; and the Guilt-Free Gluttony, with turkey bacon, white cheddar, and hard-boiled eggs. At 9 a.m., a driver delivers the freshly-made salads to the company’s network of vending machines, empties the jar return, and retrieves any left over food from the previous day to donate to a local food pantry.

“Our whole business model is built around sustainability, he says. “We keep an energy meter on every machine so that we can keep track of exactly what we are consuming, and our long term goal is to offset that somehow. Everyone who is driving for us has to have fuel efficient cars.”

There are some conventionally grown ingredients in Farmer’s Fridge products.

“Our first goal is to feed people and make them healthy,” he says. That may mean including South American-grown berries to make the salads widely appealing.

The company is always careful to clearly label each ingredient so that consumers know which ingredients are organic or locally sourced.

Sticking to his promise to organically source all products listed on the dirty dozen list has occasionally been a challenge. In the beginning, the staff at his wholesale produce distributor would try to substitute conventionally grown cucumbers when they were out of organic cucumbers. Saunders would have to return the shipment and reiterate his requirements.

Learning how to manage supply and demand was also tricky. Consumption varies greatly by machine and by day, he says. Some days he has more leftovers than the local food pantry can use. On other days, the machine runs low by 12:30 p.m.

So far, the reception has been extremely positive, he says. The Yelp page for a Farmer’s Fridge kiosk in Chicago’s business district has nearly two-dozen positive reviews.

Saunders says he would like to see his concept grow both locally and around the country. He believes the City of Chicago could support hundreds of these machines and he is looking to expand to other cities in the years to come.

“If we get to a point where we feel like we can expand without compromising quality, we will,” he says.